[The author is particularly indebted for information in Kirkpatrick Sale. "The World Behind Watergate," New York Review of Books, May 3, 1973; and Martin Murray, "The United States' Continuing Economic Interests in Vietnam," Socialist Revolution, Nos. 13-14. MIT political scientist Walter Dean Burnham helped clarify a number of ideas through a lecture he gave at Harvard this summer. For more on Watergate and foreign policy, see Noam Chomsky, "Watergate: A Skeptical View," New York Review of Books, September 20, 1973. None of the above are responsible for errors in interpretation the author may have made.]

RON ZIEGLER'S calling Watergate a "third-rate burglary" was comical, but hardly the administration's most embarrassing Watergate explanation. The Ervin Committee has heard a host of implausibilities--from Bernard Barker's hope that CIA would again invade Cuba to "Bob" Haldeman's suspicions that communist governments were underwriting the Democrats.

Nixon and his underlings have concocted a sad and feeble tale of overzealous, but conscientious men breaking a few laws in a good cause. But who expected otherwise from the masters of double-think? None of Nixon's henchmen foresaw placing their heads on justice's block, and why not lie when the truth sounds equally implausible?

In his recent article, "Watergate: A Skeptical View," radical scholar Noam Chomsky convincingly argues that Watergate is one of Nixon's lesser crimes. The affair, he maintains, has attracted extraordinary attention only because its victims were members of the powerful liberal establishment.

Chomsky says that if we keep in mind Nixon's Indochina genocide:

...the exposures of the past several months are analogous to the discovery that the directors of Murder, Inc. were also cheating on their income tax. Reprehensible, to be sure, but hardly the main point.

But the Watergate revelations do have significance: "They indicate, once again, how frail are the barriers to some form of fascism in a state capitalist system in crisis."

Chomsky's comments on Watergate are among the most incisive so far written. But he understates what Watergate can teach us about Nixon, or, for that matter, about liberal writers. A close examination of Watergate shows that fascism is not merely Nixon's response to crisis; fascism is apparently the next stage of U.S. state capitalism.

Liberal explanations of Watergate have never gotten down to causes. Some blame Nixon's arrogance; some conjure up generalizations about national psychology. The most bizarre reasoning of all passes Watergate off as a one-of-a-kind right-wing crime whose exposure somehow vindicates the liberal system of justice.

Such explanations, especially the national psychology-type, have a disconcerting way of assuming what they purport to explain. Considering how regularly the government has undermined the rights of radicals for 60 years, the claim that government crime is exceptional seems especially untenable.

But the liberal failure to understand Watergate's historical roots is no accident. There are three clear-cut causes:

* Liberal writers have an ideology--and a political and economic system behind it--to protect. Since 1936, liberals have defended the growth of capitalism by assuring dissidents that the system was learning to correct social abuses.

How could faith in the system be justified if Watergate-type crimes, and worse, are not once-only exceptions, but constitute the logical outgrowth of the system's development?

* Liberals have failed to tie Watergate to the rest of Nixonism to avoid implicating men dear to the Eastern establishment. If we connect Watergate to Nixon's foreign policy, and his attitudes toward Congress and the two-party system, we must ask about the roles of men such as Kissinger, Richardson, Weinberger and Schlesinger--to name, for example, a few of the Harvard men in this administration.

* The Liberals have fallen into their customary error of confusing social issues with personality issues. If we look at Nixon rather than at the presidency and dwell on his arrogance rather than the changing structure of politics, we can limit criticism of the system to criticism of Nixon, and rejoice in his troubles as the triumph of justice.

But such errors need not be committed. We can examine the connections between Watergate and the rest of Nixonism. We can plot out the effects of Nixon's presidency on U.S. political development. If we do so, a pattern emerges.

Watergate indicates the debut of a new stage in the relation between capital and the State, between the U.S. and other countries, and between branches of the government. Nixon's setbacks represent not a "triumph of the system," but the persistence of New Deal ideology and legal norms in the post-New Deal United States.

Optimists may hope that fascism can be averted by impeaching the offending president now. But Nixon, for all his crimes--including 1 million deaths and inestimable destruction--will not be impeached, probably not even censured. If only Nixon's departure will save the U.S. from fascism, American political democracy is already doomed.

II

THE MOST SUCCESSFUL U.S. presidents share two complementary traits: an unswerving committment to overall goals--to U.S. economic growth, in particular--and a general willingness to experiment with almost any means to attain their ends.

For example, Franklin Roosevelt is remembered as a liberal reformer. But the consequences of his programs were unquestionably conservative. Resorting first to welfare programs and industrial self-regulation, then to government regulation and finally to war, Roosevelt tried everything short of socialism to preserve U.S. capitalism intact. His rhetoric, meanwhile, labeled him the common man's champion.

Roosevelt's was a particularly instructive case for "crisis presidents."

His example reveals the conditions behind major political crises and illustrates the measures that a crisis president must take.

For the last two centuries, the U.S. has faced a major shift in economic organization about every 36 years. These result from shifts in the regional concentration of economic power, in the leading sectors of economic growth, or in the forms of business organization most profitable in major industries or agriculture.

In several cases, these have been accompanied by shifts in the composition of economic elites. New groups of businessmen and politicians have risen to the top. At other turning points, the same people retained control of the economy but entered new kinds of profit-making activity.

Periodically, these economic reorganizations-which were necessary to advance the interests of either new elites or the "leading sectors"--radically altered the relationship between individuals or certain social groups and the economic system. The new elites naturally worked to restructure or gain control of political and cultural institutions. Part of the task of redirecting society must always be generating changes in laws and popular values compatible with the ruling class's new economic activities.

But not all structural changes occur smoothly. Growing out of changes in, and reshaping both social structure and technology, the process itself occasionally leads to squabbling among elites and, even more dangerously, to economic depressions.

The Depression of the thirties posed the gravest American economic and political crisis since the Civil War. It threatened not only the corporate giants which had grown since the end of World War I--the future of all capitalism, including its political and cultural institutions, looked dismal.

Roosevelt faced the three conditions which create a crisis presidency:

* The economy's sectors were in drastic economic trouble, requiring a redefinition of business's relation to government.

* A major ideological crisis had developed from economic stress and the breakdown of traditional values among hard-hit social groups. Ideological anarchy threatened when tried-and-true maxims finally proved useless for dealing with everyday reality. Only a central figure in authority could restore some sort of order.

* The president needed to win acceptance for a new concept of governmental power to supersede laws, political norms and elite values lingering from the economy's earlier stages.

Roosevelt, hardly a radical or socialist sympathizer, learned two crucial lessons. First, even if a president sees that prevailing economic conditions demand radical remedies, he must cast his political programs in terms of mainstream values and legal norms--even if that semi-radical program is ultimately no threat to the ruling class.

Second, to safely protect economic elites in crisis, the president must champion the cause of "neglected" social groups, assuring the public that a return to old values is, in fact, what is needed to relieve economic and social stress for all.

NIXON IS THE first crisis president since Roosevelt. Only that fact makes his dramatic turnabouts understandable--from laissez-faire conservative to price controller, from commie-hater to champion of the detente.

TWO STRUCTURAL changes have reshaped the economy since World War II: In relative terms, power on the domestic economic front has shifted to what historian Kirkpatrick Sale calls "the economic sovereigns of America's Southern rim, the 'sunbelt' that runs from Southern California, through Arizona and Texas, down to the Florida keys":

They are for the most part new-money people...whose fortunes have been made only in the postwar decades, mostly in new industries such as aerospace and defense contracting, in oil, natural gas and allied businesses, usually domestic rather than international, and in real-estate operations during the postwar sunbelt population boom.

On the other hand, established corporations have turned their attention to international investment through multinational enterprises. Such projects, especially the extraction of foreign natural resources, require new forms of government protection and rely on supposedly neutral planning and development agencies.

The "cowboys," as the Southern rim's entrepreneurs have been called, and the multinational industrialists face three immediate problems:

* Traditional U.S. legal norms and New Deal-type regulatory agencies are incompatible with the new expansion and the stability of the new elite's power.

* "Internationalism" has acquired a bad name because of the Vietnam war, and widespread environmental concern has cast the oil men in a bad light.

* Popular unrest in the U.S. threatens to undercut support for a powerful chief executive--the primary agent of the growing industrial supergiants in their efforts to circumvent New Deal government regulation.

These when added to the always-smoldering social unrest under capitalism, are the ingredients of Nixon's economic and political crisis. Nixon also faces the continuing threat of war to the structure of multinational capitalist expansion and additional domestic anti-business sentiment as a consequence of galloping inflation.

To overturn the institutional remnants of the New Deal, he has turned to a set of beleaguered social groups for support: the so-called Silent Majority of lower-middle class, white urban ethnics and small-town and rural people of the South and Midwest.

Watergate was part of the program Nixon men designed to reshape the political system to support their economic and political rule. The Watergate conspirators are closely tied to the Southern rim's magnates. They expected to go unpunished--even if they were caught--because of Nixon's unprecedented executive power, his subversion of the New Deal ethics, and the distance he has established between himself and Congress. They almost got away with it--and Nixon may get away with it still.

How are the new elites and multinational corporations attempting to reshape the United States's legal and political system? How have they manipulated foreign policy? What obstacles remain in their path?

A review of the answers to these questions reveals the contours of Nixon's fascist blueprint and underscores the dangers of his remaining in office.

III

LAWLESSNESS is already a Southern rim tradition. And most of the major Watergate conspirators, as well as Nixon's chief backers, began their careers in the Far West or South.

Haldeman and Nixon's appointments secretary Dwight Chapin were Los Angeles advertising men. Ehrlichman was Haldeman's UCLA classmate and a Seattle real estate lawyer--while he wasn't practicing political espionage for Nixon. Barker and Jeb Stuart Magruder are both Southern rim entrepreneurs, and Herbert Kalmbach has become the region's fastest-rising lawyer.

Among the least savory cowboys is Nixon's closest comrade-in-arms, C. G. "Bebe" Rebozo, a Florida real estate speculator whose associates reportedly included Bernard Barker.

Rebozo's career was probed in a Fall 1971 News day expose. Among his less noble accomplishments are selling stolen stocks, wringing special favors from the U.S. Small Business Administration, delivering building contracts to mobsters, and reportedly capitalizing on government connections to benefit from real estate deals.

In "The World Behind Watergate," Kirkpatrick Sale sums up the cowboys' attitude toward law:

Whether because of the newness of their position, their frontier heritage, or their lack of old-school ties, they tend to be without particular concerns about the niceties of business ethics and morals, and therefore to be connected more than earlier money would have thought with shady speculations, political influence-peddling, corrupt unions, and even organized crime.

But Sale neglects another source of Southern rim "lawlessness": Men dealing in crucial industries with limited markets or restricted supplies--as in oil, real estate, and defense contracting--require close ties to government and large-scale planning to insure unhindered growth, favorable markets, and the safety of their collusion. Especially in prosperous times, when the public cares little about business ethics, the7The Watergate Bad Guys The Watergate plotters included Southern rim entrepreneurs and conservative-lawyer-opportunists: H.R. HALDEMAN (left) was a Los Angeles advertising man; former presidential counsel JOHN W. DEAN III (middle) was fired from his Washington law firm for secretly aiding a client's rival in a television licensing case. JOHN EHRLICHMAN (right) saw both kinds of action: During the sixties, he alternated real estate law practice in the Far West with sometimes-clandestine campaign operations for Nixon.